Garments without guilt? : an exploration of corporate social responsibility within the context of the fashion supply chain : case study of Sri Lanka

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The aim of this thesis is to understand how fashion supply chain characteristics affect the implementation of Corporate Social Responsibility (CSR) at factory level for garment manufacturers in lower labour-cost countries that supply Western high street fashion retailers. A dynamic, challenging global industry, the high street fashion industry is one of few sectors under simultaneous pressure for short lead times and low costs. Additionally, increasing global dispersion of garment manufacturing to lower labour-cost countries has led to concerns about worker exploitation and firms are now under pressure to deliver societal goals as well as shareholder profits. CSR represents the business response to minimising the negative societal impact of global business operations; however, the very nature of the fashion supply chain with the pressure on cost and lead time compromises CSR implementation at factory level.
A qualitative case study approach was selected in order to gain greater depth of understanding of CSR in fashion supply chains; specifically, to explore from a managerial perspective the impact of negative and positive forces within the fashion supply chain on CSR implementation, with a view to understanding how CSR implementation can be reconciled with the competitive challenges of the fashion sector. Fieldwork was conducted in Sri Lanka, a key global garment manufacturing location, within 7 case study companies which were selected to represent the range of business sizes and models in the export garment manufacturing sector. Data collection methods included on-site face-to-face semi-structured interviews with key informants and non-participant observation within factory environments. Analysis of interview transcripts was conducted manually, using Eisenhardt’s (1989) method of within-case and cross-case analysis, and triangulated with observational data and documentary evidence.
The theoretical contribution is the synthesis and categorisation of factors within the context of fashion supply chains that impact both negatively and positively on CSR implementation at factory level in a lower labour-cost country, followed by an understanding of the interplay of global fashion supply chain characteristics and their impact upon CSR implementation at factory level. It was concluded that the inherent conflict between CSR principles and the characteristics of fashion supply chains may be reconciled by moving away from traditional adversarial supply chain relationships and adopting the Supply Chain Management (SCM) philosophy of long-term orientation and shared goals between trading partners. Furthermore, CSR implementation was influenced by product nature, the level of service provided by the supplier and the long-term partnership approach to buyer-supplier relationship management in the Sri Lankan context. The core basic nature of the product meant that orders were more likely to be long-running, so manufacturers were sheltered from the unpredictability in orders and frequent style changes characteristic of fast fashion. This level of stability enabled suppliers to invest in CSR implementation. Full package suppliers fostered strong relationships with retailers over considerable periods of time (10-20 years) and collaborated on initiatives to increase efficiency and agility, such as cost reduction and vertical integration of pre-production activities. However, contract manufacturers without value-added services were unable to develop strong collaborative relationships with buyers which would enable greater investment in CSR implementation. Although Sri Lanka is classed as a global leader in ethical garment manufacture, much is therefore dependent on the size and provision of services offered by the supplier, which dictates the nature of the buyer-supplier relationship: vertically integrated full package suppliers had closer links with buyers than contract manufacturers and hence greater ability to drive CSR implementation through the business.